As your life grows to include more responsibilities and dependents, it becomes even more crucial to protect the most valuable asset in your life — yourself. But when you think about life insurance, it’s hard to know where to begin. There’re different types of life insurance plans, and each offers benefits catering to different financial needs.

Whole life insurance, for example, covers you for life while a portion of your premium gets invested for cash accumulation. This may seem attractive to some, but it requires a long-term financial commitment. And the premium tends to be more expensive. If you’re looking into obtaining substantial coverage for a lower cost, term life insurance might just be the option.

What are the benefits of term life plans?

1. It offers flexibility

Since term life insurance limits their coverage to a specific period of time, you can dictate just how much money you are going to commit.

For example, if you have a young family and you want to ensure that they'll be looked after financially in the event you are no longer able to support them, you might consider a 10- or 20-year term plan. This ensures your family has a strong financial safety net for the years they are most dependent on you.

When you’re no longer the sole income earner of your family — perhaps your children are grown and self-sufficient — or you’re financially secure, term life insurance might no longer be a necessary fail-safe.

2. It is affordable

Good life insurance is not something that anyone should overlook, especially when you have dependents.

When you’re building your career and starting a family, money is always a big deal. Term life insurance tends to be more affordable and offers the coverage you need when you need it.

If you are the sole breadwinner for your family, the loss of your income could heavily impact their security and growth.

Term life insurance offers a solid and affordable way for you to protect your loved ones from financial burdens should you lose your income due to permanent disability, terminal illness, or death.

3. It is straightforward

If your primary goal is to obtain a financial safety net for you and your family, term life insurance does just that. Think of it as a no-frills, straightforward option that offers just what you need — a lump sum payout in the event of permanent disability, terminal illness, and death. This means you are simply paying for what you need while having the autonomy in growing your nest egg however you want it.

Is term life insurance the right choice for you and your family? 

As a general rule of thumb, the Life Insurance Association of Singapore (LIA) recommend purchasing 9 to 10 times* your annual income in morality coverage. The amount of life insurance coverage you apply for is a personal decision determined by your unique circumstances and your individual needs.

Term life insurance offers a flexible and affordable way for you to ensure your family’s financial security. Regardless of what life insurance you choose, make sure you meet your financial needs and those of your family.

To find out more details on term life insurance for your future financial needs, leave your details below to get in touch with one of our financial planners.

Sources:

*2017 Protection Gap Study—Singapore by LIA

Disclaimer:

This article is for general information only and does not take into account the specific investment objectives, financial situation or needs of any particular person. The views expressed herein do not necessarily reflect the views of HSBC Life (Singapore) Pte. Ltd. and should not be construed as the provision of advice or making of any recommendation. There is no intention to distribute, offer to sell, or solicit any offer to purchase any product. We recommend that you seek the advice of a qualified financial advisory professional before making any decision to purchase an insurance or investment product. Whilst we have taken reasonable care to ensure that all information provided was obtained from reliable sources and correct at the time of publishing, information may become outdated and opinions may change. We are not liable for any loss that may result from the access or use of the information herein provided.

Information is correct as at 1 February 2023.

This advertisement has not been reviewed by the Monetary Authority of Singapore.